Labor Dispute Resolution in China
In China, if mutual negotiation can’t solve a labor dispute, then related authority’s involvement will be needed for an effective solution.
Unlike in general civil or commercial disputes, the parties can choose the authority to solve the dispute---arbitration or lawsuit, either party to a labor dispute has to apply for a labor arbitration first instead of going to the court directly. The reason for the initial arbitration phase is to try to solve the dispute without getting the court involved, to avoid a waste of judicial resources. However, since the low cost for labor arbitration and lawsuit--either party has to pay just 10 RMB to file for it—sometimes, the party will appeal until the last phase just because they want to hold executing the result. A total waste of judicial resource and the other party’s time.
It’s required that the labor dispute be submitted to a labor arbitration commission in the district where the employer is located. The application to arbitrate must be filed within one year from the date the cause of action arises, and the arbitration panel has 60 days from the date of filing to issue a decision. The decision of the arbitration commission is binding, but a party may bring the dispute to the courts if dissatisfied with the arbitrator’s decision. And like any other civil or commercial disputes, the second instance will be the final one. So a labor dispute could be solved within three months, but it probably would take one and half years, if the whole procedure has to be gone through.
Since 2008, when the Labor Contract law and relevant arbitration laws came into effect, the amount of labor dispute cases has risen. Two main reasons are:
· 1. Generally, the younger generation have more right-protection awareness and are apt to use judicial resources to settle disputes.
· 2. The fees involved are limited...